In 2004, Shri Vaghela won parliamentary elections from Kapadvanj, his own constituency. Soon, under the UPA-I Govt., he took charge as the Union Minister of Textiles, India. Between 2004 and 2009, the textile industry of India went under remarkable transformations under his able governance. For the Textile Industries, he removed the CENVAT, as a result, India entered a zero excise regime and textile sector took–off. He introduced the Specially Integrated Textile Park (SITP) Scheme under which Rs 40 crores as subsidy for project costing Rs 100 crores were offered. He also offered special financial help to expand Jute industry and to increase the wages of laborers.